The mirage of the efficient city

I’m honored to be contributing a short essay to a Festschrift for Jane Jacobs. Recently, the editor asked me to write an abstract. The following is the result, which I would like to share with you:

A city is not a man-made thing. Rather, it emerges from the actions of its inhabitants, who interact in unpredictable yet orderly ways. Under the right conditions – the right “rules of the game” – what arises is vital, creative, radically unpredictable, and profitable: the living city.

The modern demand to rationalize the city and to make it “more efficient” is misplaced. A living city cannot be efficient. Efficiency, in the economic sense, presupposes an overarching plan against which measured outcomes can be evaluated. A living city, however, follows no such plan. It is itself the unplanned, collective result of the countless individual plans executed continuously in it, day after day.

Neither can it be inefficient, because that too presupposes a system-wide plan. Both efficiency and inefficiency presume that we know how things ought to be, what success and failure look like, and that’s impossible in the urban dynamic. Instead, borrowing from ecology (and certain heterodox schools of economic thought), we might say that a living city is a “dynamically stable” process, in which the forces of positive and negative feedback, as well as sudden mutation and diversity, combine under the right conditions to generate order through time. It embodies trial and error, surpluses and shortages, apparently useless duplication, conflict and disappointment, trust and opportunism, and discovery and radical change. These are in the nature of the living city.

Today’s designer-jeans industry in downtown Los Angeles, for example, was cobbled together from the remnants of earlier investments by big manufacturers. Such entrepreneurship often arises from overlooked opportunities hidden in the detritus of previous experiments. The freedom to pursue opportunities where no one else imagined them to be, to develop urban space in ways radically different from earlier uses, enables the process of creative destruction that is the living city to take place.

That process issues both breathtaking advances and deep disappointments. Earnest attempts to preserve large parts of the city or to consciously direct its evolution, like trying to preserve or control any complex living thing, will drain the life from it.

“Neither can it be inefficient, because that too presupposes a system-wide plan.”

While I understand what you are trying to say, you go a bit far here. Specifically, a city can be inefficient without a system-wide plan.

A city which fails to effectively root out crime, which imposes high transaction costs on its citizens, which is unable to react to natural disasters or plagues, and whose employees are corrupt is a city which is inefficient without any sort of plan at all.

While it may be impossible to centrally plan greatness, it is certainly possible to prevent the emergence thereof without a plan as well.

Inefficiency, like efficiency, presupposes a plan against which to gauge the success or failure of an action. High transactions costs, crime, and corruption MAY of course be consistent with efficiency, depending on the costs and benefits of removing them. (Note: I’m NOT saying that these ARE efficient.) My point is that it’s important to distinguish the concept of economic inefficiency, which is what my essay is addressed to, from “things most people don’t like.”

You’re right that preventing a city from becoming great does not require a plan, but preventing greatness is often the unintended consequence of trying to implement a central plan at the local level.

Hmm. I agree that the liveliness of a city comes mostly from individual actors doing their own thing and dynamically cooperating with each other (as in buyer-seller). However, it’s nearly impossible to discount the importance of centralized bureaus that coordinate things such as land and title, highways and other things. What about rules and regulations for buildings that don’t fall down and insulation that doesn’t clog your lungs? Throwing out the center (plans, rules, etc) for the sake of the periphery (individual action) rests on a false dichotomy, not seeing the cooperation and tension between them (central planning and individual action).

My real problem with this post/abstract is that it is heavy on theory and position but small on detail in a situation, but then again, it’s only an abstract.

Imagine 20 million people living in a city with no highways, paved roads or subways. How ‘orderly’ do you think that’d be?

“Imagine 20 million people living in a city with no highways, paved roads or subways. How ‘orderly’ do you think that’d be?”

This reminds me of a point made in a World Religions class I was in, ..years ago. In discussing what the world would be like without “God,” one student, clearly disturbed by the idea, spoke up, “There would be total chaos and destruction without religion to show us the way, to tell us how to live!…”

The professor’s point, and I agree, is that this presupposed “chaos amidst the absence of any central plan,” isn’t real. Human beings are by and large, orderly creatures.

We like structure, we like orderliness. We are creatures of a largely well ordered universe, despite some obvious exceptions.

My point is, 20 million people living in a city with no highways or roads at all would never happen. That statement itself is a theoretical impossibility if we’re talking about the human beings we’ve come to know and love. Do lots of people live in horribly cramped places with cruddy dirt roads? Sure, China comes to mind. Is there utter chaos and destruction because of it? No.
Human beings will seek order – for the large majority of the time, even in war. Plan or no plan. The evidence is all around you.

It seemed to me that Sandy wanted to throw out the bathwater (central planning) but threw away the baby with it (infrastructure – mostly built or improved by gov’t).

You say that Human beings will seek order, true. Humans not only seek order, they seek to create it. Without some organizing body (gov’ts, standards groups, certification bodies) then semi-organization (not chaos)is the result. Sandy looked at the coordination necessary for those particular industries, but not the coordination necessary in which those industries were created (laws, trade agreements, licenses, cloth standards, etc)

Sandy looked at the coordination necessary for those particular industries, but not the coordination necessary in which those industries were created (laws, trade agreements, licenses, cloth standards, etc)

Laws and standards did not create the innovations, they only regulated them. Human ingenuity creates solutions to human needs and desires, not intervention into ingenuity such as laws, licenses and standards… Agreements facilitate ingenuity among those who agree, but they do not in themselves create.

hengels:
Our mis-communication/mis-conception, I think, is that you are assuming that most standards, laws, regulations and the like are intrusive, and thereby bad. I don’t agree with that. I’m going to restrict my commentary to standards, however I would apply this reasoning just a little less to licenses and almost rarely to laws.

When you say that standards ‘only regulated’ innovations I think you’re missing their critical importance. Try to fit a square peg in a round hole, or fit a metric nut into an English unit bolt.

Standards are not necessarily an ‘intervention into ingenuity’ that you cast them as. The creation of the USB standard allows hundreds of computers peripherals to connect to your motherboard without a vast proliferation of thousands of ports. Is that an intervention into ingenuity?

The Keystone Advantage by Iansiti and Levien describe at length the critical importance of standards that enable businesses and business ecosystems to flourish.

Software companies create APIs, the IEEE and other bodes create standards. Standards enable interoperability between different functions, which in itself facilitates innovation and lowers the cost of entry into a domain. Standards facilitate ease of use and accessibility.

You actually said as much when you said “Agreements facilitate ingenuity …but they themselves do not in themselves create.”

philosophical trivia: any thing (concept, invention) conforms to its own standard by definition, so maybe your problem with my argument (that standards get in the way of innovation) is self-refuting (because innovations are themselves a standard).

Our mis-communication/mis-conception, I think, is that you are assuming that most standards, laws, regulations and the like are intrusive, and thereby bad.

I do agree with the statement that laws and regulations are intrusive and bad. However, that is not an ‘assumption’, but a conclusion. Standards that are voluntary (IEEE, LEED, etc.) can be good, but not likely those that are imposed top-down. Standards that emerge through voluntary “agreements” tend to “facilitate” innovation better than those imposed by a third party governmental authority, which tends to hamper innovation.

—–any thing (concept, invention) conforms to its own standard by definition, so maybe your problem with my argument (that standards get in the way of innovation) is self-refuting (because innovations are themselves a standard).

if innovation = standard, then standard = innovation

Then all innovation arrives only through creation of standards, which is empirically false. Thus, innovation = standard must be logically false.

I believe Andrew and Hengels make some good points. I do also think, however, that one of the problems Byron raises, the role of government in the provision of large-scale infrastructure, is important.

Before I (briefly) address that problem, let me reiterate that the issue I address in my post is the NOT whether central planning might sometimes produce benefits to the residents of a city, but whether it’s proper to say that those results can be measured by the yardstick of economic efficiency. Again, to the extent that the city is a spontaneous order, it cannot be — end of story, really. BUT to the extent that emergent urban processes are crowded out by governmental decision making, which can be (but need not be) informed by an over-arching plan, a kind of TECHNICAL efficiency (ie, in the engineering sense) may become more applicable. In the latter case, the city begins to take on the characteristics of a giant bureaucratic machine. Think of Rome under the Caesars, which to survive was entirely parasitic on its provinces.

Now,to the problem Byron raises, which I interpret as: “When government constructs local infrastructure can it succeed in helping to promote the kind of urban dynamism I describe in my post?” I think the answer is “sometimes yes,” as Haussmann seems to have done for Paris in the mid-1800s, giving rise in a couple of decades to “the city of light.”

On the other hand, London, which had no central government until about the same time (1855), managed to construct before then the first major boulevards in a European city, Regent Street. Now, the latter twists and turns through central London — compare it with the arrow-straight boulevards Haussmann built — because the various township and local governance bodies would not permit the builder (John Nash) to significantly impinge on their property rights. Not many such roads were built, but countless other, smaller streets were, long before and after. Moreover, London by 1800 was already a city of over 1 million, 2 million by 1850. Paris and London at that time were the greatest cities in the Western world.

Finally, it should be made clear that the need for collective GOVERNANCE, which in a great city is probably indispensible, does not imply the need for GOVERNMENT. In other words, cooperative arrangements among networked neighborhoods or districts can generate the kind of infrastructure we’re talking about here. Just two references, among many others on this: Nicola Tynan’s work on water provision in London, and the work Peter Gordon and I did on “private neighborhoods” http://www.mercatus.org/PublicationDetails.aspx?id=21330 in post-Katrina New Orleans.

I’m saying that innovations are a subcategory of the class standards (think venn diagrams, not equations). Any thing is defined according to a set of standards. Oranges are relatively round, about 1/3lb, smaller than grapefruit and orange in color when ripe etc. These are the definitional standards I was alluding to but did not explicate. The little philosophical tangent/quip was simply to say that innovations have standards which they must conform to in order to be considered a specific kind of entity, regardless of it being considered an innovation (the standards of which are ‘new’ and ‘unique’ and possibly ‘useful’). Sorry for creating a tangent that distracted from the main point that we agreed on.

Sandy:
I agree with what you say, that governance doesn’t necessitate government. But some nagging in the back of my head says that people’s ability to work out their differences (where to put a road, how many police to hire) while including all the relevant parties (stakeholders and people affected) is severely under-developed and nearly doomed to failure.

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I agree that a city is not man made but is rather created by the people that live in that city. This means that our city becomes what me make it to be. Therefore, we should do our best to keep it clean and preserve the culture.